Donors, Aid and Taxation in Developing Countries: An Overview

Tax Revenue Mobilization in Conflict‐affected Developing Countries

“…The influx of aid and international actors in post‐conflict settings creates the risk of aid dependency, and the concurrent risk that policymakers' incentives will be distorted away from investing in long‐term tax collection capacity and politically costly forms of taxation (Bornhorst, Gupta, & Thornton, ; Boyce & Forman, ; Carnahan, ; Chowdhury & Murshed, ). While recent research suggests that a negative connection between aid and tax collection is by no means guaranteed (Alonso & Garcimartín, ; Clist & Morrissey, ) and is highly context‐specific (Prichard, Brun, & Morrisey, ), it is plausible that in post‐conflict settings, the risk may be especially acute owing to relatively high levels of aid being introduced into relatively weak institutional contexts over short periods. At the same time, foreign aid may ‘crowd out’ tax collection capacity through the exemptions that exist for many international actors and aid‐funded activities.…”

“…Accordingly, there is a greater need for international actors to focus on the modalities of aid. At the same time, there remains a need for greater research about the effectiveness of revenue‐related aid conditionality, including the types of conditions being employed and the incentives, both positive and negative, that they create (Bolnick & Hadler, ; Prichard et al, ).…”

Taxing the Informal Economy: The Current State of Knowledge and Agendas for Future Research

“…18. For example, over-reliance on revenue targets, by governments and donors alike, likely generates disincentives for taxing the informal sector effectively and equitably (Bird & Vazquez-Caro, 2011;Fjeldstad, 2001;Prichard, Brun, & Morrissey, 2012). 19.…”

The Political Economy of Domestic Tax Reform in Bangladesh: Political Settlements, Informal Institutions and the Negotiation of Reform

“…In turn, research has long suggested that fiscal crises and moments of political transition can be critical to opening new opportunities for reform, as they can serve to strengthen support for reform while disrupting existing networks of resistance (Fjeldstad & Moore, 2008;Keen & Lockwood, 2010;Mahon, 2004;Sanchez, 2006). As importantly, international pressure and supportmost often from the IMF -has often been an important driver of at least superficial reform (Fjeldstad & Moore, 2008;Keen & Lockwood, 2010;Mahon, 2004;Prichard, Brun, & Morrissey, 2011;Sanchez, 2006).…”